Thousands of home owners have been caught in a scam where low-grade timber was used instead of a premium product in building projects.
A former managing director of a West Auckland timber company, Larry Roger Binns, has pleaded guilty to 36 charges of breaching the Fair Trading Act and has been fined $15,000.
The Commerce Commission says customers were misled about the grade of timber trusses and frames he supplied to them.
The commission began an investigation into the company after a building inspector noticed that timber used in a frame was different to that stated on the specifications supplied by the company.
The commission estimates about 4000 structures such as houses and garages have been built using frames supplied by the company, Total Frame & Truss Limited, which is now in liquidation.
While there is no risk of the frames failing, it says they may bend under extreme conditions.
Company called a 'rogue operator'
The commission's fair trading manager, Greg Allan, says the deception was simply about cutting costs.
The Wood Processors Association says the company is a rogue operator and the public should not lose faith in using timber products.
Association chief executive Peter Bodeker says he is disappointed members of the public have received a substandard product.
Master Builders Federation chief executive Warwick Quinn says that if the problem had not been spotted as quickly as it was, 30,000 homes and garages could have been affected, instead of the 4000 that were.